Novavax (NVAX -0.43%) has had more than its share of ups and downs over the past few years -- and investors have been along for the ride. The stock soared 2,700% in 2020 as the company brought its coronavirus vaccine candidate through late-stage clinical trials. But when Novavax's program fell behind, the shares lost ground.

The biotech company's vaccine reached commercialization later than rivals. And this meant Novavax missed out on that first huge wave of demand.

The company isn't giving up, though. Today, Novavax is preparing itself for a post-pandemic world. Should you invest in this embattled player and bet on a better future? Here's one green flag and one red flag.

The green flag

The coronavirus vaccine story isn't over. Yes, the massive burst of demand and revenue associated with a pandemic situation is a thing of the past. But there still is opportunity for Novavax and other vaccine companies to generate significant revenue in a post-pandemic world.

Vaccine leader Moderna even predicts the coronavirus market will follow that of the flu -- so it's possible about half of the U.S. population will go for annual boosters.

Novavax could benefit from this because the company is developing a product many will love. It's a combined flu/coronavirus vaccine candidate. Moderna also is working on a combination shot, but Novavax's program is farther ahead from a timeline perspective. After positive phase 1 results, Novavax moved on to phase 2 -- and expects to report data around the middle of this year.

A combined shot clearly could attract those who regularly go for an annual flu jab. It offers them a quick and easy way to protect themselves from both viruses.

If Novavax is able to bring its product to market before rivals, it could gain significant market share -- and establish a source of recurrent long-term revenue.

The red flag

The problem for Novavax right now is actually making it through today's tough times. In the company's most recent earnings call, management suggested the possibility of shutting down. That's considering uncertainties such as a U.S. funding agreement that may not result in full payment.

Of course, Novavax is taking steps to avoid the worst and keep the company going and progressing. For example, the biotech is talking with the government about how it might secure the expected funding payments. The company also is working to cut spending and better manage its cash flow.

Still, Novavax is in a complicated situation. The company has significantly increased spending to build out the huge commercial infrastructure needed to address a pandemic. Yet Novavax's vaccine reached the market late in the health crisis -- so it didn't bring in the same levels of revenue as rivals. For example, Moderna's vaccine generated $18.4 billion last year, while Novavax's product sales totaled about $1.5 billion.

Now, Novavax's management team has to quickly turn things around -- and in an environment of declining vaccine sales. So, the coming months may be complicated and high risk for Novavax and its investors.

Green or red?

It's important to focus on the long term when investing. But sometimes current problems cloud our view of the situation down the road. And that's what's happening with Novavax right now.

The company is taking action to improve its financial situation and prepare for a post-pandemic market. This is positive. And the company may succeed.

But it's too early to be sure of that success right now. And Novavax's warning about a potential shutdown if things sour is enough to make me very cautious until we see strong signs of improvement.

Novavax's shares may look tempting at today's level. They've dropped 92% over the past year -- and have lost all of their pandemic gains. But I don't see this as a buying opportunity. Investors have lost faith in the company. So, until we see some signs of progress from Novavax, it's best to watch this biotech company from the sidelines.